EMD-78-68: Published: Jun 15, 1979. Publicly Released: Jun 15, 1979.

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The government relies on the natural gas reserves estimates published annually by an industry trade association, but the creditability of these estimates has been challenged in recent years because the data could not be independently verified. The Energy Information Administration (EIA) is developing a program with an appropriate and comprehensive approach to collect these estimates.

However, further development and improvement in the program is needed. The EIA program will collect national estimates of reserves and related data for natural gas, crude oil, and natural gas liquids. The approach is to obtain the information from those who have the best knowledge of the reserves, both on and offshore. The EIA program was supposed to supersede duplicative government programs, but two programs are which are less comprehensive. The U.S. Geological Survey (USGS) program will collect information only on leases on the Outer Continental Shelf (OCS). The Federal Energy Regulatory Commission (FERC) program will collect information only on natural gas and not from companies operating exclusively in the intrastate markets. The Department of the Interior is required to investigate trade associations' natural gas reserves estimates on OCS and provide estimates of oil and natural gas reserves to states and local governments. These requirements should not be used as support for a duplicative reserves estimation program, but should be met through use of reserves estimates collected under the EIA program.

Matter for Congressional Consideration

Status: Closed

Comments: Please call 202/512-6100 for additional information.

Matter: Congress should not appropriate any additional funds for the USGS Reserves Inventory Program.

Recommendation for Executive Action

Status: Closed

Comments: Please call 202/512-6100 for additional information.

Recommendation: The Secretary of Energy should direct the Administrator, EIA, to: (1) document whether all the data to be collected under the oil and gas reserves information program are needed to fulfill government responsibilities; (2) conduct a pilot test of the data collection form; and (3) emphasize the development of a strong validation program to make sure that the data collected are accurate and complete. FERC should advise EIA that it does not require the EIA program to collect data on individual reservoirs. The Secretary of the Interior should meet the requirements for reserves estimates of oil and natural gas through the use of reserves estimates collected by the EIA program. The President should eliminate the staff positions authorized for the USGS Reserves Inventory Program and add to EIA the number of positions needed to fully staff its validation program.